Ethereum

Bitcoin

Impact

<p style="text-align: justify">You can also read this news on COINTURK NEWS: <a href="https://en.coin-turk.com/how-will-expiring-contracts-impact-crypto-markets/" data-wpel-link="internal">How Will Expiring Contracts Impact Crypto Markets?</a><br></p>
<p class="p1" style="text-align: justify">Significant developments continue in the cryptocurrency market. Accordingly, <a href="https://en.coin-turk.com/expert-crypto-commentator-cryptocurrencies-will-peak-on-this-date/" data-wpel-link="internal">Bitcoin</a> and <a href="https://en.coin-turk.com/former-us-president-donald-trumps-ethereum-holdings-cause-excitement-in-cryptocurrency-market/" data-wpel-link="internal">Ethereum</a> option contracts worth a total of $2.4 billion will expire on May 3, which could increase market volatility. A Bitcoin option contract allows investors to speculate on Bitcoin price movements without owning the Bitcoin itself.</p> 
<h2 class="p1" style="text-align: justify" id="option-contracts-and-the-crypto-market">Option Contracts and the Crypto Market</h2> 
<p class="p1" style="text-align: justify">There are two types of option contracts; put and call options. Put options give investors the right to buy cryptocurrency at a certain price before a specific date. Call options allow investors to sell a cryptocurrency unit at a certain price before the expiration date.</p> 
<p class="p1" style="text-align: justify">Investors often use the put/call ratio as a measure to assess the overall market condition. If investors are buying more puts than calls, it is considered a sign of a downturn, and if they are buying more calls than puts, the market sentiment is considered bullish. A put/call ratio below 0.7 is considered a bullish trend, while a ratio above 1 is considered a bearish indicator.</p> 
<h2 class="p1" style="text-align: justify" id="what-to-expect-in-the-market">What to Expect in the Market?</h2> 
<p class="p1" style="text-align: justify">On May 3, a total of 23,367 Bitcoin contracts worth $1.39 billion will expire. According to data from the Deribit exchange, the current put/call ratio for Bitcoin option contracts is at 0.5, and the maximum pain point is $61,000. The maximum pain point represents the price that would cause the most financial losses for the largest number of asset holders.</p> 
<p class="p1" style="text-align: justify"><img loading="lazy" loading="lazy" decoding="async" class="aligncenter wp-image-347531 size-full" src="https://coin-turk.com/wp-content/uploads/2024/05/deribit.webp" alt="" width="1339" height="506"></p> 
<p class="p1" style="text-align: justify">Similarly, a total of 334,248 Ethereum contracts with a nominal value of $1 billion are also expected to expire on May 3. The put/call ratio for these expiring contracts is 0.37, and the maximum pain point is $3,000. Historically, the expiration of option contracts has been followed by short-term price volatility in the spot <a href="https://en.coin-turk.com/what-is-ripple-xrp/" data-wpel-link="internal">crypto</a> market. Bitcoin and Ethereum have been under downward pressure for the past few weeks.</p> 
<p class="p1" style="text-align: justify"><img loading="lazy" loading="lazy" decoding="async" class="aligncenter wp-image-347530 size-full" src="https://coin-turk.com/wp-content/uploads/2024/05/ether-scaled.jpg" alt="" width="2560" height="639"></p> 
<p class="p1" style="text-align: justify">The price of Bitcoin has fallen below $60,000, indicating a nearly 20% correction over the past week. The price of Ethereum also dropped below $2,900. The crypto market is generally known to rebound from the volatility caused by options a few days after expiration.</p> 
<h5><span style="font-weight:bold;font-size:16px">The post first appeared on COINTURK NEWS: </span> <a href="https://en.coin-turk.com/how-will-expiring-contracts-impact-crypto-markets/" data-wpel-link="internal">How Will Expiring Contracts Impact Crypto Markets?</a></h5>

How Will Expiring Contracts Impact Crypto Markets?

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